TORONTO – As LCBO workers prepare to walk the line, Ontario small craft brewers fear a strike will hurt their bottom line.
On Wednesday liquor board employees filed a May 17 strike deadline with the Ministry of Labour in case contract negotiations break down with the crown-operated retail giant.
The strike deadline coincides with the Victoria Day long weekend that could leave Ontarians without spirits, import wines and craft beer for the holiday.
While customers looking for beer can still head to The Beer Store retail outlets not affected by a potential strike, smaller Ontario breweries could lose out on one of their busiest holiday weekends.
“A strike would really hurt us,” Mike Gurr, a sales and marketing coordinator with the Kensington Brewing Company, told Global News. “Half of our sales are through the LCBO. They have given us exposure to the rest of
Ontario, without them we would be confined to the GTA.”
Gurr says that unlike The Beer Store, the LCBO provides an equal playing field for all companies.
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According to a report from the Fraser Institute, The Beer Store charges a one-time listing fee of $2,650.14 plus an additional $212.02 for every product sold per store.
For example; a brewery with 3 distinct products selling in packs of 6,12, and 24 would be charged a listing fee for nine products.
The Beer Store also charges a handling fee that equals $3.65 and $4.15 for every case of 24 beers.
Craft brewers also take issue with The Beer Store’s ownership of Anheuser-Busch InBev, Molson Coors and Sapporo.
“Having to pay our competition for second rate advertising is ridiculous,” said Gurr. “We get a tiny square on the wall, while the beer sits in the back collecting dust.”
Railway City Brewery based in London, Ont. who does roughly 30 per cent of their sales through the LCBO is worried about losing the liquor stores valuable display model.
“Because the craft beer is displayed on the shelf it helps with brand recognition,” Paul Corriveau, Railway City’s VP of Marketing and Sales, told Global News. “With the beer store you have to know what beer you want.”
Corriveau says Railway City is considering a move to incorporate a private store into the brewery as the company expands.
Junction Craft Brewing in Toronto has a tap room and private retail store where beer aficionados can sample the different beers before taking home a six-pack.
Larger craft brewing companies like Mill St. have even included a restaurant creating another dimension to the beer tasting experience.
More than 7,000 LCBO employees have been without a contract since March 31 and the union representing the workers says “very little progress” has been made at the bargaining table with crown corporation.
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